If the
way Congress has mismanaged "The AIG Affair" doesn't tell you
what a bunch of clowns represent you, nothing will. If you believe Congress
is really trying to solve the AIG problem (which, to be totally truthful,
Congress created) you should not read the rest of this article. It will
make you angry.

Yes.
To answer a popular question, Timothy Geithner, our inept Treasury Secretary,
had to know about the employee bonuses being paid to AIG. If he did not
know about the bonuses, he wasn't doing his job as the head of the New
York Federal Reserve Bank (which he was, at the time the bonus agreement
occurred). It's this simple: If he is so naïve or dumb that he did
not know what was happening, he has no business being Secretary of the
Treasury for the United States of America. And, these appear to be the
only two possibilities: Either he lied, or he is dumb and naïve.

When
I was president of the MacGruder Agency, a bank financial consulting firm,
I signed a lot of contracts with commercial banks. When a bank wanted
to retain me, I gave them my consulting contract which was then given
to the bank's lawyers. Each bank added its own requirements. My contract
told them they would have to pay for my first class airfare, for example.
It told them how many hours I would work during a "day" and
how many of my days each year the amount they were paying would buy.

They
required specific things of me, too. I was promising to create a credit-driven
private bank for them. They required me to specify costs and services
provided. In other words, the contract made clear what we could expect
from one another.

From
the largest to the smallest banks in America with which I worked, believe
me if I did not perform as my contract said I would, they could have terminated
the contract any time. Now, when a group of people are so inept as to
bring a company to bankruptcy, there is plenty of reason to say "You
didn't earn your bonus this year." There is rarely - if ever - a
contract offering money for performance that does not have a specific
performance clause in it.

There
was one logical question to be asked of Edward M. Liddy, President and
CEO of AIG, when Congress raked him over the coals at hearings last week.
You know which hearings I mean - where everyone was "outraged"
over the employee bonuses? One question needed to be asked and I certainly
didn't hear anyone ask it. Thus, the "outrage" lacks credibility.

"Where's
the beef?"

Translated:
"Where are the employment contracts signed by AIG? I need a copy
to determine what you promised to pay these people and what you required
of each employee to earn this bonus. Black out the names if need be, but
I need to see a copy of the contracts you say you absolutely must honor!"

Without
a copy of the AIG contract giving bonuses of $165 million to employees,
no one really knows whether or not the bonuses had to be paid.

"But
we need this money to retain these employees," was the story given.

Really?
Then maybe you can explain why over three dozen of them have already left
the company.

Because
the right questions were not asked, I mark the Congressional hearings
off as "artistic performance," not serious questions and answers
trying to solve a problem.

Rather
than ask one simple question - the right question - Congress instead passed
what appears to be unenforceable legislation. Pelosi's past actions have
proven how little concern she has for the U.S. Constitution, so it should
surprise no one that she is willing to tromp on the civil rights of a
group of people to over-compensate for not doing sufficient due diligence
before giving AIG huge amounts of money. This problem exists because of
her arrogance and stupidity!

AIG
isn't the only mistake Congress made. For example, did you know that Goldman
Sachs is offering money to employees they had to terminate because of
the economic crises that company helped create? Yep. Such a nice thing
to do, too, offering their former employees tax dollars to pay their moving
expenses to locations where it might be easier to find employment. Haven't
heard about that one yet?

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Surely
you read the Wall Street Journal article this week about Fannie Mae paying
bonuses to its employees? These are retention bonuses of from $470,000
to $611,000 to be paid in 2009 to executives. Frankly, we would all be
better off if every executive at Fannie Mae and Freddie Mac were not "retained."
The performance of the company certainly doesn't justify doing anything
to encourage Fannie's executive managers to stay nor for paying them a
bonus.

Bear
in mind, Fannie and Freddie just reported combined losses of nearly $108
billion largely from home mortgage defaults. Who decided to bank those
mortgages? Executive managers they want to retain via a bonus are responsible
for such decisions. If they were not, they should have been. The Treasury
Department will provide up to $200 billion for Fannie and $200 billion
for Freddie.

The
two mortgage behemoths currently need $60 billion in additional funds
(since TARP) to cover loan losses to date. There are so many mortgage
bankers looking for jobs right now, it is very doubtful anyone is going
to walk away from their job over a lost bonus. If they do, we still win.
With a little help from Congressman Barney Frank (D-MS) and Senator Chris
Dodd (D-Del), they got us into this mess. We could benefit from their
departure.

Are
you feeling "outrage" yet? How about this:

Thirteen
of the firms that received billions of dollars of bailout money owe hundreds
of millions of dollars in UNPAID TAXES.

See
how generous you are, America? You not only loan AIG money so it can pay
foreign banks billions and billions of dollars, you pay back taxes owed
for companies who haven't paid their own tax bills! What a country!

One
company that received bailout funds owed $113 million in unpaid federal
income taxes, another $1.1 million (plus another $223,000 in federal employment
taxes). Oh, they can't release the names of these companies to you. That
wouldn't be fair. Apparently it's fair for you to get billed for everything
but kept ignorant of for what your tax dollars pay (and those of your
children and grandchildren).

All
of the banks and other firms that received federal money signed contracts
stating they had no unpaid taxes so if they lied, we can prosecute them.
That, of course, won't get your money back, but it will help you with
the "outrage" and reduce the costs involved with your anger
management classes.

Using
AIG as an example, here's what is outrageous.

After
the big AIG fall last September, Edward M. Liddy, 62, took over two positions
with AIG, succeeding Robert B. Willumstad. Prior to taking on responsibilities
for the failing AIG, Liddy was affiliated with Sears as Chief Financial
Officer (CFO) and later was Chairman of Allstate Insurance.

AIG
has been presented to the American public as an "American-based"
company. It has offices in New York, but its corporate headquarters is
in London. The company's roots are in Shanghai - which is part of the
People's Republic of China. Specifically, AIG was founded by C.V. Starr
as American Asiatic Underwriters in Shanghai in 1919. In 1921, Starr founded
Asia Life Insurance Company. It was the first company to offer life insurance
to the Chinese people. .In 1975, Maurice R. Greenberg, Chairman and CEO
of AIG at the time, traveled to Beijing for the first time. He made many
similar trips during future years.

Is that
what you call an American company? I don't.

AIG
was involved in credit swaps - you don't need to know what they are to
understand what AIG did, so I'm not going to waste words explaining it
- with 25 international financial institutions. These financial institutions
are called "counterparties." Had you, dear taxpayer, not been
so generous, when the credit swaps went bad and AIG was unable to pay
insurance losses on them without billions of tax dollars, the company
would have gone into bankruptcy… probably Chapter 11. AIG first
gave these "counterparties" the collateral supporting the loans.
You understand the collateral process. Just look around your neighborhood
and you'll be sure to find someone who's been foreclosed on. The bank
took possession of the collateral on your neighbor's mortgage loan by
kicking their butts out into the street. That's the collateral process.
So, AIG first gave their "counterparties" loan collateral. Later,
AIG gave them billions of your tax dollars and, lo and behold, it made
the "counterparties" whole.

Looking
at the amount of money injected via funds given to AIG because it needed
to be saved and then somehow got into United Kingdom coffers, I'm sure
we can expect a thank you note from the Queen, any day now.

In other
words, while your legislators are keeping you either entertained or nervous
with "outrage" they themselves created, the American taxpayer
has once again gotten the fickle finger of fate shoved in their faces
- but it's a golden finger!

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They
are keeping your attention diverted from what is really going on in the
hallowed halls of your United States Congress.

The
employee bonuses totaled only $165 million. The payments to all of those
foreign entities listed above almost totals $100 billion.

Marilyn
Barnewall received her graduate degree in Banking from the University
of Colorado Graduate School of Business in 1978. She created the first
wealth creation (credit-driven) private bank in America in the 1970s.
Prior to her 21-year banking career, she was a newspaper reporter, advertising
copywriter, public relations director, magazine editor, assistant to the
publisher, singer, dog trainer, and an insurance salesperson and manager.

She
was named one of America's top 100 businesswomen in the book, What It
Takes (Dolphin/Doubleday; Gardenswartz and Roe) and was one of the founders
of the Committee of 200, the official organization of America's top 200
businesswomen. She can be found in Who's Who in America (2005-08), Who's
Who of American Women (2006-08), Who's Who in Finance and Business (2006-08),
and Who's Who in the World (2008).

In other words, while
your legislators are keeping you either entertained or nervous with "outrage"
they themselves created, the American taxpayer has once again gotten the
fickle finger of fate shoved in their faces - but it's a golden finger!